| Strathmore Ridge Homeowners Assn., Inc. v Mendicino |
| 2009 NY Slip Op 05318 [63 AD3d 1038] |
| June 23, 2009 |
| Appellate Division, Second Department |
| Strathmore Ridge Homeowners Association, Inc.,Appellant, v Michael Mendicino et al., Respondents. |
—[*1] Flower, Medalie & Markowitz, Bay Shore, N.Y. (Donald Markowitz of counsel), forrespondents.
In an action, inter alia, for a judgment declaring that certain leases executed by thedefendants are void for the defendants' failure to comply with the leasing restrictions containedin an amendment to the plaintiff's bylaws dated November 29, 2005, and for injunctive relief, theplaintiff appeals (1) from an order of the Supreme Court, Suffolk County (Rebolini, J.), datedSeptember 6, 2007, which denied that branch of its motion pursuant to CPLR 3211 which was todismiss, for lack of standing and failure to state a cause of action, the defendants' firstcounterclaim, among other things, for a judgment declaring that the leasing restrictions containedin the amendments to the plaintiff's bylaws dated March 30, 2004, and November 29, 2005,respectively, are invalid, and granted those branches of the defendants' cross motion which were,in effect, for summary judgment dismissing the second, third, and fourth causes of action and onthe first cause of action for a judgment declaring that the leases are not void, and on so much ofthe first counterclaim as was for a judgment declaring that the leasing restrictions are invalid,and (2), as limited by its brief, from so much of a judgment of the same court entered October29, 2007, as, upon the order, is in favor of the defendants and against it dismissing the complaintand declaring that the leasing restrictions contained in the amendments to the plaintiff's bylawsdated March 30, 2004, and November 29, 2005, are invalid and null and void.
Ordered that the appeal from the order is dismissed; and it is further,
Ordered that the judgment is modified, on the law, by deleting the provision thereofdismissing the first cause of action of the complaint and substituting therefor a provisiondeclaring that the subject leases executed by the defendants are not void for the defendants'failure to comply with the leasing restrictions contained in the amendment to the plaintiff'sbylaws dated November 29, 2005; as so modified, the judgment is affirmed insofar as appealedfrom; and it is further,[*2]
Ordered that one bill of costs is awarded to thedefendants.
The appeal from the intermediate order must be dismissed because the right of direct appealtherefrom terminated with the entry of judgment in the action (see Matter of Aho, 39NY2d 241 [1976]). The issues raised on the appeal from that portion of the order are brought upfor review and have been considered on the appeal from the judgment (see CPLR 5501[c]).
The Supreme Court properly denied that branch of the motion of the plaintiff, StrathmoreRidge Homeowners Association, Inc. (hereinafter the Association), which was to dismiss thedefendants' first counterclaim pursuant to CPLR 3211 for lack of standing and failure to state acause of action. Contrary to the Association's contention, the defendants, as owners of propertygoverned by the Association, had standing to assert a counterclaim to set aside amendments tothe Association's bylaws (see e.g. Demchick v 90 E. End Ave. Condominium, 18 AD3d383, 384 [2005]). Further, viewing the defendants' allegations as true, and according thedefendants the benefit of every favorable inference (see Leon v Martinez, 84 NY2d 83,87-88 [1994]), the allegations made in support of the first counterclaim are sufficient to state acause of action to set aside the amendments, inter alia, on the ground that they were improperlyenacted without a prior amendment of the Association's declaration of covenants, restrictions,easements, charges and liens (hereinafter the Declaration).
The court also properly granted that branch of the defendants' cross motion which was forsummary judgment on so much of their first counterclaim as was for a declaration that theleasing restrictions contained in amendments to the bylaws dated March 30, 2004, andNovember 29, 2005, respectively, are invalid. The business judgment rule applies to the actionsof a condominium or housing association's board of directors (see generally Matter ofLevandusky v One Fifth Ave. Apt. Corp., 75 NY2d 530 [1990]). "So long as the board actsfor the purposes of the [Association], within the scope of its authority and in good faith, courtswill not substitute their judgment for the board's" (id. at 538; see Levine v Greene,57 AD3d 627 [2008]; Gillman v Pebble Cove Home Owners Assn., 154 AD2d 508[1989]). Here, the defendants demonstrated, prima facie, that the Association exceeded the scopeof its authority in enacting the amendments to the bylaws which prohibited and/or restrictedleasing without first amending its Declaration, and that the amendments are, therefore, null andvoid. In opposition, the plaintiff failed to raise a triable issue of fact (see Alvarez v ProspectHosp., 68 NY2d 320, 324 [1986]).
Since this is, in part, a declaratory judgment action, the Supreme Court's judgment shouldhave included an appropriate declaration in favor of the defendants with respect to the first causeof action of the complaint (see Lanza v Wagner, 11 NY2d 317, 334 [1962], appealdismissed 371 US 74 [1962], cert denied 371 US 901 [1962]). Mastro, J.P., Skelos,Santucci and Hall, JJ., concur.